Leading Economic Indicators
Leading Economic Indicators
The Leading Economic Index fell 0.5% in November.
LEADING ECONOMIC INDICATORS :: NOVEMBER 2023
The Conference Board Leading Economic Index® (LEI) declined 0.5% in November following a revised 1.0% decline in October. During the six months from May 2023 through November 2023, the LEI contracted by 3.5%, an improvement from the 4.3% decline observed in the prior six-month period. Weakness was widespread, with nine of the ten index components either neutral or negative. Stock prices were the only positive component within the index.
“Despite the economy’s ongoing resilience—as revealed by the US CEI—and December’s improvement in consumer confidence, the US LEI suggests a downshift of economic activity ahead. As a result, The Conference Board forecasts a short and shallow recession in the first half of 2024.”
-Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board
Source: The Conference Board
Source: The Conference Board
The Coincident Economic Index® (CEI), a measure of current economic activity, rose 0.2% in November. Looking at the six months between May 2023 and November 2023, the CEI rose 1.0%, up from the 0.7% pace during the prior six-month period. Strength was widespread, with all four CEI components increasing in November.
FEDERAL RESERVE UPDATE
The next Federal Open Market Committee (FOMC) meeting is scheduled for January 30th and 31st. We do not expect any change in monetary policy at the January FOMC meeting. The market is now pricing in a greater than 80% probability of a fed rate cut at the March 20th FOMC meeting. Today’s revised third-quarter PCE inflation data showed that core-PCE inflation was just 2.0% during the third quarter. If inflation remains near current levels, a March rate cut is possible.
The 2024 FOMC Meeting schedule is:
January 30-31
March 19-20*
Apr/May 30-1
June 11-12*
July 30-31
September 17-18*
November 6-7
December 17-18*
*Summary of Economic Projections update.
The table below shows which Federal Reserve Bank Presidents will vote in 2024.
In case you missed it, here is our list of Recommended Books published earlier this month.